Spokes | Resources for Nonprofits

Find Us On Social Media:

Mileage Reimbursement for Volunteers?

by

Should our nonprofit reimburse volunteers at the business rate because nonprofits are businesses? Or should we reimburse at the rate for charitable organizations?

First of all, whether or not to provide mileage reimbursement to your nonprofit’s volunteers is optional. So is the rate at which you choose to reimburse them. But there is an important caveat!

The IRS reimbursement rate for charitable mileage is currently 14 cents per mile. If a volunteer itemizes deductions and keeps track of miles driven for charitable purposes, that amount can be a deduction. But, if you choose to reimburse the volunteer at a higher rate, the volunteer must report the difference as income.

If you choose to offer mileage reimbursement to your volunteers, it is good practice to adopt a written policy that makes it clear what trips qualify, when and how the reimbursement will be made, and what documentation the volunteer must submit in order to be reimbursed.

Here are some sound resources on this topic:

Compliance Checklists

by

When you’re running a nonprofit, you want to spend your time pursuing your mission, not filling out forms. But there’s no avoiding the fact there are a lot of details to worry about to keep your organization in compliance with various federal, state, and local laws and regulations. If you have employees, especially if you have many employees, compliance can be a big issue. Here are a few checklists that can help you keep track of some key compliance issues.

Nonprofits Compliance Checklist. CalNonprofits offers this basic checklist of key filings every incorporated nonprofit needs to be aware of and complete if appropriate. It includes such things as the Statement of Information which you need to file every other year, the Annual Registration with the Attorney General’s office, and the Federal Annual Information Return (forget to do that for three years running and you’ll lose your tax exemption!).

HR Compliance Toolkit. UST provides this set of ten resources that you can download for free (assuming you’re willing to share your email address). The HR Audit Checklist is a four page document that easily leads you through a simple self-assessment of what you’re doing right and what you might want to work on. Other handy tools in the kit include an interview checklist and an exit interview checklist.

Compliance Calendar. Do you offer medical benefits to your employees? If you do, you have more things you may need to file. Morris and Garritano provides an annual Compliance Calendar that can help you comply in a timely fashion.

5 or More Employees? Read this!

by

California employers — including nonprofits — are required by state law to facilitate enrollment in the CalSavers program if they don’t offer an employer-sponsored retirement plan and have five or more employees. All eligible employers can register at any time prior to their registration deadline. The deadline for employers with more than 50 employees was June 30, 2021. The deadline for those with 5 or more is June 30, 2022.

Don’t get caught behind on this one! If you are not in compliance, you face a fine of $250 to $500 per employee. Click the the link below for full information.

https://employer.calsavers.com/home/employers.html

Contracting for Fundraising

by

We recently had the question at Spokes, “What are the pros and cons of using independent contractors for fundraising and basing their fee on the amount of money raised?” Good question!

The answer? Well, when done correctly, it is legal, but there are lots of steps that must be taken. In addition, there are ethical and practical issues that you really need to consider before taking this route. If you or your board is considering this approach, Spokes recommends you carefully review the following references, in order.

Compensating Nonprofit Fundraisers – this is a good overview that gives pros and cons.

Professional Fundraising Consultants and Grantwriters  – Pay particular attention to the section, “Did you know?”

California Attorney General’s Guide for Charities – California is a state that does require both the fundraising professional or company to be registered and the charity/nonprofit to follow specific procedures as to contracting, etc. See Chapter 9 beginning page 68.

AB5 issue. – Finally, be aware that California now has very stringent rules with regard to employees versus independent contractors. Basically, a person is an employee unless “proven otherwise.” There is a list of exceptions that includes “grant writer” but not fundraising consultants.

Do You File IRS Form 990-EZ?

by

The Taxpayer First Act, enacted July 1, 2019, requires tax-exempt organizations to electronically file information returns and related forms. The requirement to file electronically generally became effective for tax years beginning after July 1, 2019. However, for small exempt organizations, the legislation specifically allowed a postponement (“transitional relief”). As a result:

  • For tax years ending before July 31, 2021, the IRS will accept either paper or electronic filing of Form 990-EZ, Short Form Return of Organization Exempt from Income Tax.
  • For tax years ending July 31, 2021, and later, Forms 990-EZ must be filed electronically.

IRS will be sending an educational letter (Letter 6194) to organizations that filed paper Forms 990-EZ previously.

Guiding nonprofits to achieve their goals through support and expert resources.

How Can We Make A Difference Together?

Spokes welcomes local professionals who would like to share their expertise in support of the nonprofit sector.

Get Started Contributing

Recent Articles